Form 1099-DA: How Crypto Cost-Basis Reporting Works (and the Mismatches to Fix)
Crypto exchanges now send the IRS a record of your sales, but often not what you paid. Here is what Form 1099-DA covers, why mismatches happen and how to fix them before they turn into a tax bill on money you didn't make.
๐ On this page โผ
๐ Figures verified Sep 28, 2026 against the IRS's digital assets guidance, the Form 1099-DA and Form 8949 pages, and the congressional resolution that repealed the DeFi broker rule (H.J. Res. 25, 2025). This is general information, not tax advice. How we check numbers โ
Crypto exchanges and other custodial brokers now report your digital asset sales on Form 1099-DA: gross proceeds for sales from 2025, and cost basis for assets bought from 2026 on in the same account. That means many 2025 forms show proceeds with no basis. Report your own basis on Form 8949, or the IRS may treat your whole sale as gain.
Numbers That Matter
| Figure | Amount | Source | Verified |
|---|---|---|---|
| Form 1099-DA gross proceeds | Reported by custodial brokers for sales on or after Jan. 1, 2025 | IRS | Sep 28, 2026 |
| Cost basis on 1099-DA | Required for digital assets acquired on or after Jan. 1, 2026 and held in the same account | IRS | Sep 28, 2026 |
| Where you report sales | Form 8949 and Schedule D, with your own basis where the form lacks it | IRS | Sep 28, 2026 |
| DeFi and self-custody platforms | Not covered: the 2024 DeFi broker rule was repealed in 2025 | Congress.gov, H.J. Res. 25 | Sep 28, 2026 |
What Form 1099-DA Reports
- Gross proceeds from selling or exchanging digital assets through a custodial broker, such as a centralized exchange, starting with 2025 sales.
- Cost basis only for "covered" assets: generally those acquired on or after January 1, 2026 in the same account. Crypto bought earlier, or moved in from another wallet, is typically "noncovered," so the basis box may be empty.
- Not DeFi: decentralized platforms and self-custody wallets aren't brokers for this purpose after Congress repealed the DeFi rule in 2025.
Why Mismatches Happen
The IRS gets the proceeds from your exchange, but it may not get your basis. If you transferred coins between wallets or exchanges, the receiving platform usually doesn't know what you paid. Since 2025, basis is also tracked wallet by wallet rather than across all your holdings, so good records per account matter. Your job is to report the correct basis yourself on Form 8949, using the category for sales where basis wasn't reported.
How to Reconcile Your 1099-DA
- Collect every 1099-DA and your own records of purchase prices, dates and transfers.
- Match each sale to its purchase lot, per account.
- Report each sale on Form 8949, entering your basis where the form left it blank.
- Answer the digital asset question on your Form 1040 accurately.
- Keep records of transfers between your own wallets; they're not taxable, but they explain missing basis.
Worked Example: A Sale With No Basis on the Form
- The form: your exchange's 1099-DA shows $50,000 of proceeds and no basis, because you bought the coins elsewhere years ago.
- Reported correctly: with your $30,000 basis, the long-term gain is $20,000, about $3,000 of federal tax at 15%.
- Reported wrong: with no basis, the whole $50,000 looks like gain, about $7,500 at 15%, plus a likely IRS notice to sort out.
Uses the 15% long-term rate for simplicity; your rate depends on income and holding period.
Decision Rules
If this, then that
- If your 1099-DA shows no basis โ report your basis on Form 8949 with records to back it up.
- If you moved crypto between platforms โ keep transfer records; they explain missing basis.
- If you use DeFi or self-custody โ you still owe tax on gains, even without a 1099-DA.
- If you have many transactions โ consider crypto tax software or a professional.
- If you get an IRS notice about unreported proceeds โ respond with your basis records.
Mistakes to avoid
- Filing the proceeds as gain without adding your basis.
- Treating transfers between your own wallets as sales.
- Assuming no 1099-DA means no tax.
- Mixing basis across wallets now that it's tracked per account.
- Answering "no" to the digital asset question when you sold or swapped crypto.
Related: the 1099-K threshold covers payment-app reporting; gambling losses after 2025 covers prediction markets; 2026 tax changes lists everything new; and crypto taxes explained goes deeper.